Why do we expect previous success to lead to future success?

The 

Hot Hand Fallacy

, explained.
Bias

What is the Hot Hand Fallacy?

The hot hand fallacy is the tendency to believe that someone who has been successful in a task or activity is more likely to be successful again in further attempts. The hot hand fallacy derives from the saying that athletes have “hot hands” when they repeatedly score, causing people to believe that they are on a streak and will continue to have successful outcomes.

Where this bias occurs

Imagine you are watching a hockey game, and a goalie makes five saves in the opening few minutes. We predict that the goalie will continue making saves because they are on a “hot streak.” 

We base our prediction on a small run of random events without considering that the goalie’s first five saves could have been chance. We assume they are on a streak because we mistakenly believe that a short pattern is representative of a larger sample. The hot hand fallacy leads us to take a small pool of data—the opening minutes of one game—as a better indicator of future performance than an average save percentage calculated from seasons’ worth of data.

Related Biases

Sources

  1. Tversky, A, Gilovich, T. & Vallone, R. (1985). The hot hand in basketball: On the misperception of random sequences. Cognitive Psychology, 17(3), 295-314. https://doi.org/10.1016/0010-0285(85)90010-6
  2. IResearchNet.com. (2016, January 21). Law of small numbers. Psychology. Retrieved August 12, 2020, from https://psychology.iresearchnet.com/social-psychology/decision-making/law-of-small-numbers
  3. Johnson, J., Tellis, G. J., & Macinnis, D. J. (2005). Losers, winners, and biased trades. Journal of Consumer Research, 32(2), 324-329. https://doi.org/10.1086/432241
  4. Castel, A. D., Rossi, A. D., & McGillivray, S. (2012). Beliefs about the “hot hand” in basketball across the adult life span. Psychology and Aging, 27(3), 601-605. https://doi.org/10.1037/a0026991
  5. Ayton, P., & Fischer, I. (2004). The hot hand fallacy and the gambler’s fallacy: Two faces of subjective randomness? Memory & Cognition, 32(8), 1369-1378. https://doi.org/10.3758/bf03206327
  6. Miller, J. B., & Sanjurjo, A. (n.d.). Surprised by the Hot Hand Fallacy? A Truth in the Law of Small Numbers.
  7. Bocskocsky, A., Ezekowitz, J., & Stein, C. (2014). Heat Check: New Evidence on the Hot Hand in Basketball (SSRN Scholarly Paper No. 2481494). https://doi.org/10.2139/ssrn.2481494
  8. Glazer, A., & Goldberg, L. R. (2020). Hot or Not? A Nonparametric Formulation of the Hot Hand in Baseball (SSRN Scholarly Paper No. 3562754). https://doi.org/10.2139/ssrn.3562754

About the Authors

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Dan Pilat

Dan is a Co-Founder and Managing Director at The Decision Lab. He is a bestselling author of Intention - a book he wrote with Wiley on the mindful application of behavioral science in organizations. Dan has a background in organizational decision making, with a BComm in Decision & Information Systems from McGill University. He has worked on enterprise-level behavioral architecture at TD Securities and BMO Capital Markets, where he advised management on the implementation of systems processing billions of dollars per week. Driven by an appetite for the latest in technology, Dan created a course on business intelligence and lectured at McGill University, and has applied behavioral science to topics such as augmented and virtual reality.

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Dr. Sekoul Krastev

Sekoul is a Co-Founder and Managing Director at The Decision Lab. He is a bestselling author of Intention - a book he wrote with Wiley on the mindful application of behavioral science in organizations. A decision scientist with a PhD in Decision Neuroscience from McGill University, Sekoul's work has been featured in peer-reviewed journals and has been presented at conferences around the world. Sekoul previously advised management on innovation and engagement strategy at The Boston Consulting Group as well as on online media strategy at Google. He has a deep interest in the applications of behavioral science to new technology and has published on these topics in places such as the Huffington Post and Strategy & Business.

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